The Lib Dems must look beyond Brexit towards 21st Century liberalism

Last week I wrote about the strategic cul-de-sac that Britain's Conservatives find themselves in. I will write of Labour, whose strategic grasp is well ahead of all the other parties, later. But we are coming up to the Lib Dem annual conference. What of them?

Alas the Lib Dems seem no better at political strategy than anybody else. They (I could also write we, as I am a party activist) had some real momentum at the start of 2017, with the strange quiescence of Jeremy Cobyn's Labour party. But the general election in June changed all that. The party organised itself around a clear message on the main issue of the day - Britain and the European Union - but to very little effect. While the party held up reasonably well against the Tories, it folded wherever it came under any pressure from Labour. Where I live, in Battersea, the Lib Dem message could have been tailor made to succeed, and yet it was Labour that reaped the reward of locals' anger at the Tory Brexit strategy - they took the seat with a lightweight campaign and an unknown candidate. I did not receive a single piece of Labour literature.

But was the party's weakness merely tactical? People who suggest this say that Labour made irreconcilable promises to different groups of voters and will be found out. And the party's advocacy of a second referendum on Europe was simply an idea ahead of its time. As Brexit rage rises (and pretty much anything that goes wrong can be blamed on Brexit), the public will look again at the party's consistent line on the matter.

For a different perspective read former leader Paddy Ashdown. This is a pair of articles (I link directly to the second) moaning about the lack of direction in the party. Paddy is not particularly coherent (he doesn't pretend to be), but I do think he is on to something. Here is the penultimate paragraph:

I have concluded that all this is so, not because we have really lost our intellectual curiosity, but because of the dead hand of Brexit. I admit second place to no-one when it comes to fighting for the best Brexit we can, and preferably no Brexit at all. I am proud of our Party’s clear position on this defining issue. But is our obsession with Brexit in danger of distracting us from what kind of country we want Britain to be, whether in the EU or out of it? For me the heart of liberalism is our crusade for the empowered citizen, not the powerful state. This is a radical disruptive and insurgent idea. But where is it? When did you last – at Conference or outside it – hear us arguing that case, debating new ideas to make it happen or proselytising it before the court of public opinion?

Liberal Democrats are united by an open view of people and cultures, and a suspicion of nationalism and strong state power. These values point to sympathy with the European Union, if you view it as a restraint on state power rather than an extension of it. But the EU is a pragmatic solution to the problem of European states needing to cooperate more closely. It is not an ideology - or a new nationalism. While I do feel a certain pride in European identity, it developed long before the UK joined the union, and it is not a nationalistic pride, that seeks to diminish Americans, Russians or Chinese. Campaigning over EU membership is a tactic and not a strategy - and this is something that Labour, whether by accident or design, have grasped more clearly than either the Conservatives or the Lib Dems.

So what is the point of the Lib Dems strategically? Are the party's values best promoted by a separate political party, or by factions within larger political groupings, i.e. the Conservatives, Labour or the SNP in Scotland? Few liberals can see a future in the Conservatives these days. One Lib Dem I knew who moved to them a couple of years ago has dropped out, unable to take the strain. I don't know the SNP well enough to comment on them - they have tempered their nationalistic defining theme with inclusiveness. The real problem for Lib Dems is Labour - because that is where most political active liberals are now going, especially the younger ones.

The critical issue here is the question of state power. The point that unites almost all successful Labour politicians, from Tony Blair to Jeremy Corbyn, is that they view a centralised state, under democratic control, as the solution to most problems. This is one of the critical debates of our time. And liberals are not pulling their weight.

One the one side we have advocates of a strong state. The most important of these worldwide is the Chinese Communist Party - and they are picking up a substantial following throughout the world. Democracy is viewed with suspicion at best. On the other you have nationalists, who seek to create culturally homogeneous nations where individuals suffer minimal state interference - and the state's main role is to keep the rest of the world at bay. Established political parties in the developed world, such as Britain's Labour and the Lib Dems, belong to neither camp, but they are struggling to put forward a coherent alternative.

Paddy Ashdown does point towards the sort of places where liberals should be looking to develop a compelling vision for the 21st Century - centring on information and technology. While I struggle to make sense of his "four dangerous ideas", they are all attempts to push the debate on in this direction.

And there is an opportunity for the Lib Dems here. While Labour is picking up some of the 21st Century agenda (not least in the way it organises itself, especially its party-within-a-party Momentum), much of it either has a statist mindset, like the Chinese Communists, or harks back to the 20th Century and its swathe of secure jobs in manufacturing and administration. I have not heard much from Labour on critical issues of privacy, ownership of data and ways that state power might be restrained.

If the Lib Dems can win the race to develop ideas for a 21st Century state that is truly liberal and democratic, then the party will have a clear purpose. But if all it does is bang on about Europe, it will, eventually, vanish.

You don’t believe in nationalism, but are quite happy with supranationalism.

Liberal Democrats worship the EU in a far more nationalistic way than most citizens who have pride in their country as defined by those who voted to Leave the EU, but are considered nationalists.
LibDems are part of the vanguard of modern day blackshirts, brownshirts, stormtroopers driving for a greater EU whatever the cost as demonstrated by the damage to employment across southern europe caused by the Euro. Germany will completely dominate the EU both economically and politically within a few years, and will drive the project forward to service Germany’s national interests, whilst the peoples of the EU will not have the democratic instruments to change it. Nationalism in full flood, and presumably still supported by the LIberal Democrats, or when the penny drops will the LibDems have their usual Damascene conversion of denying anything to do with it, but something must be done.

A good starting point in defining 21st century liberalism would be to ask yourselves whether you actually want to be part of British politics for the benefit of British citizens, because at teh moment everything LibDems say or do seems to be geared towards the disadvantage of the British in preference to just about anybody else.

Well I’m flattered that you’ve read at least some of my article. Lib Dems, of course, think it helps British citizens to have full access to Europe and the wider world, and not cut ourselves off from it in a sinkhole of nostalgia. That way nationalism and support for selected supra-national organisations doesn’t conflict. But you are right that the party should make that case more persuasively.

“Liberal Democrats are united by an open view of people and cultures, and a suspicion of nationalism and strong state power. These values point to sympathy with the European Union, if you view it as a restraint on state power rather than an extension of it. ”

I think many “view it” as replacing 28 smaller states with one very undemocratic larger something or other! It’s not even a proper state with its own government.

The Left has been lured into thinking the nation state is powerless against the corporations. The Right has been smarter. They know it has to co-opt the power of the state for its own ends, and restrict it for the popular purpose. They fear that if the citizens ever work out what is really goes on, the power of the state can be recaptured by all of us.

The nation state is much more powerful than the left realise. The nation state has armies, laws, police forces, tax inspectors. The nation state, unless it has been silly enough to give it up, has the power over the currency. Nation states can borrow money at just about 0% interest. Or even create it at exactly 0% interest. But the nation state is only useful to the people if they exercise strong democratic control. If Government doesn’t run the economy in the interests of the people -out they go! And so they should.

The idea on the left is that nation states have to band together in an EU type structure to fend off the corporations. It’s actually the other way around. They are unnecessarily giving up their powers for little return. They are tying themselves together and restricting their own freedom of movement. If they have a “free trade” deal, any multinational corporation sets up it HQ in the one with the lowest rate of corporation tax, somewhere like Luxembourg, and the that’s where the profits are declared. There’s not a lot anyone else can do about it.

If the voters complain about neoliberal austerity there’s little point electing a Keynesian inclined government as they don’t control the currency any longer. It’s been a smart move by the right wing establishment which has played on the centre left’s innate sense of internationalism. The ‘progressive left’ has fallen for it hook, line and sinker!

Yes I thought you’d rise to that one! But we aren’t really disagreeing. The fact that the EU is not a proper state with a proper government means that it is more a restraint on state power than a new superstate. And if you think that restraint on state power is often a good thing – checks and balances and all that – then you might look at this more sympathetically. As a good socialist you view restraints on state power as a bad thing, and the EU, accordingly as a form of insanity. But, to make this a bit less abstract, to many younger (and yes better educated and cosmopolitan) Britons, the EU means an extension of their own personal possibilities – through travel and work – and not a restraint. Which is why this segment turns out to be so europhile, and why the EU may win out in the long run.

I don’t think the left, or centre-left, necessarily underestimate the potential power of the nation state. After all Venezuela and Cuba still carry on as independent entities in spite of cocking a nook at most of the rest of the world. But they can’t think of a single case where a country has become more prosperous except through some form of free trade and commercial deregulation. And most success stories in the modern era (China, India, South Korea, etc) have done so by moving in the neoliberal direction, even if they did not sign up to the whole ideology. Meanwhile countries that have focused on highly centralised state power tend only to do well if there are natural resources they can exploit. They end up by only enriching the ruling elite and suppressing democracy.

And yes, it is easy enough to send multinationals packing, but at a big cost. People need the services and goods they provide and they will be poorer if access is restricted.

The problem is that the left has not found a convincing answer to neoliberalism, even as they become more and more aware of its failings. Increasing the power of the nation-state creates more problems than it solves. Who wants to live in North Korea?

Venezuela, Cuba and Nortb Korea all in the same reply. I’m a little disappointed at that!

I’m more inclined to cite the European democracies of the post war era. We aren’t going to “send the multinationals packing”. But we should insist they pay corporation tax on the profits they make in the UK. If we don’t trust them to declare their profits correctly we send in experienced tax inspectors and calculate it oursleves. It’s no secret what profit Starbucks makes worldwide. Its no secret what their turnover is in the UK and elsewhere . So it’s not difficult to calculate what they should be paying.

So what are they going to do if we insist they pay 25% or whatever the rate is of corporation tax? Give up the other 75% too just to spite us? I don’t think so.

Touché. I don’t really disagree. The solution I have advocated is unitary taxation. Countries apportion global profits according to revenue, employment and property, and are taxed accordingly, bypassing the quagmire of transfer pricing, intellectual property, etc. This is what US states have been doing for generations, mainly using the Massachusetts Formula, so there is there plenty of experience in how to make it work. California attempted to apply this globally in the 1980s, but was stopped, not least by heavy lobbying from the UK (BAT in particular was upset). Of course I think this should be applied by international agreement, via the EU and then G20. But there is no sign of the idea being taken up, so I would support unilateral action.